Whether we need it or not, the federal government seems ready to give us a stimulus package — an ultra-expensive shot of economic adrenaline designed to get the drowsy economy up and moving again. Federal Reserve chief Ben Bernanke endorsed the basic concept, and Democratic leaders in Congress are giddy at the prospect of mailing fat checks to their constituents in an election year. Advertisement All of this is designed to avoid a recession — which generally is defined as the economy shrinking for six consecutive months. It may well be that the Federal Reserve, by cutting short-term interest rates, could shake the economy out of the doldrums without a budget-busting stimulus package. Properly done, such a package puts cash into people’s hands so that they can spend it and give business a boost. The impact was blunted because the program excluded the working poor — the very people most likely to spend the money. read more

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